Follow the ABC's Peter Ryan.
Analysis of global and Australian business, finance and economics.

Friday, February 21, 2014

G20 communique` - will it be worth the paper it's written on? Treasurer Joe Hockey demands a two page document with tangible outcomes.

Institute of International Finance forum in leadup to G20 meetings. Photo: Peter Ryan

Australia's hosting of central bank governors and finance ministers from the Group of 20 (G20) nations is meant to be more than just a few days in the global limelight for the land "downunder" before it's back to business as usual.Even so it's easy to understand why some people write off G20 deliberations as a just another high-powered gabfest for politicians, bureaucrats and economists who don't necessarily live in the real world.Around 530 delegates - the big players travelling at the pointy end of the plane - have descended on Sydney and will be pursued by 320 journalists searching for that special speech, briefing or security incident that will make this meeting just a bit different from the last one. The cost of hosting the Sydney meeting and the main game in November when G20 leaders come together in Brisbane is $360 million, a price tag that many families might question given the government's pursuit of austerity.And what do most casual observers remember about similar summits from the past, apart from television news images of protesters storming venues or the obligatory "class photo" of the participants at a postcard landmarks?Unlike APEC summits, thankfully G20 group photographs do not mandate lairy shirts that defy most fashion conventions. It's said G20 participants take themselve more seriously and prefer standard business attire .But could this G20 gathering defy predictions from hardened airchair cynics and deliver tangible outcomes that are meaningful to regular people worried about an uncertain world?The Treasurer Joe Hockey is hoping so - and not just for a successful event that will endorse Australia's presidency of the G20.On the eve of the G20, the International Monetary Fund has urged advanced economies to be cautious a about withdrawing economic stimulus too rapidly and that emerging nations are suffering now that the US Federal Reserve is taking away a dripfeed of cheap and easy money which is now down to US$65 billion a month.But the IMF's warning that "the recovery is still weak" and "significant downside risks remain" could be opportunity ringing in the Treasurer's ears as a sign that opportunities for strong-willed action might be running out.Speaking at an Institute of International Finance forum, Mr Hockey highlighted the challenges of turning good intentions and motherhood statements from recent G20 agreed frameworks into meaningful action."In the aftermath of the global financial crisis, the G20 recognised that the recovery was too slow and many downside risks remained. The Framework was the G20's solution to improving its macroeconomic coordination, " Mr Hockey said."Unfortunately, despite the G20's initial intention to do so, it did not go down to the next layer of detail and set clear, practical goals. "Further, the Mutual Assessment Process set up by the G20 did not provide enough top-down guidance to make sure our individual and collective actions were sufficiently well coordinated to maximise the impact on the global economy."Mr Hockey's challenge to deliver tangible outcomes as the current steward of the G20 will require hours of hard talk and a fair share of diplomatic arm-twisting.Veterans of forums like the G20 say peer pressure is a key tactic in building trust and collaboration between players who have to deal with matters of self-interest.It is anticipated that "robust discussions" are likely over negotiations for the G20 to set a global growth target - something the G20 has never set.Australia, Canada and the United States are known to be advocates of a target but it's been reported that Germany will resist, citing the setting of a target as an "antiquated" form of economic planning.Apart from the slogan of "going for growth", the G20 agenda will look at investment, trade, taxation, employment and regulatory reform.But the communique that will be issued when the summit ends late on Sydney will be key to the perception of the event's success as a critical building block to the G20 leaders summit to be held in Brisbane in November.The drafting of the communique itself will be a challenge after Joe Hockey ordered that it be no longer than two pages.In the recent past communiques have extended to 27 pages, so Mr Hockey's plea for jargon-free brevity will most likely be delivered with the fine print coming in a separate document.G20 delegates have told the ABC the challenge this time around will be to "do it better than it's been done in the past".The test, come Sunday, will be whether the meetings end with a communique that lays the groundwork for tangible outcomes or whether the document will be more of the same and not worth the paper it's written on.

No comments:

Post a Comment

Listen on Soundcloud

Subscribe to Main Street

About Peter Ryan

Peter Ryan is one of the ABC's most experienced journalists. With more than 30 years in the game, he contributes to a range of ABC News programs including the flagship radio current affairs programs AM and The World Today in addition to ABC News 24 and ABC News Online. As a former ABC Business editor he established Lateline Business (now The Business) and Business Today in 2006 and oversaw the ABC’s business and economics coverage across all platforms. After working in the corporate sector, Peter rejoined the ABC in 2003 as Executive Producer of ABC Television’s Business Breakfast program. Peter's previous journalism career includes three years as the ABC's Head of TV News and Current Affairs in Melbourne; almost five years as Bureau Chief and television correspondent at the ABC's Washington Bureau; a year as a producer at the BBC in London and a range of ABC reporting and producing roles in Melbourne, Sydney, Darwin and the South Pacific. Peter began his journalism career in newspapers at Sydney's Daily Mirror in 1980 and he worked in Sydney commercial radio before joining the ABC in 1984.